The Difficult Task Of Retail Inventory Management

Retail inventory management is probably one of the most complex of all inventory management departments. In retail management, you’ll have a greater variety of products to store and a great deal more of each product. In fact, your warehouse may never be big enough to hold all the merchandise that you need to keep in stock, and it can be difficult to maintain the right number of any particular item at any given time. How can you solve the problem, or at least address it, before it becomes too much to handle?

Retail inventory management should never be the job of a single individual but should be divided into departments and classified accordingly. For example, in a supermarket, you’ll have two major departments – grocery and non-grocery – and each will have several subcategories. Under grocery, you can expect such departments as meat, dairy, frozen, canned, and more.

Delegation of Responsibility

Depending on the size of your store, your retail inventory management could be divided into the two main categories and delegated to two individuals who would be responsible for the management of your entire inventory, or you could break it down further, having an employee in charge of each smaller division. This would allow the individual to gain an intimate knowledge of how quickly each product sold and how often it needed to be reordered. This would easily allow you to account for excess stock in some areas while others remained fairly empty.

The important thing to remember in retail inventory management is that you most likely have a little storage space for an enormous array of products and have to determine what will and won’t be important to maintain in quantity. Being efficient in carefully stocking the storage areas, as well as knowing what your best sellers are, can help you keep your retail inventory management process strong and in balance.

Being In Charge – Inventory Control Management

After several years of being a forklift driver or stocker, you’ve been promoted, and now you are in charge. What this means for you is more than a raise – it also means an incredible responsibility for inventory control management. Now, it’s your job to see that stock levels are maintained in a reasonable fashion and that all items are accounted for when inventory checks are made. It means that the organization of inventory for an entire department or warehouse is now your responsibility. What can you do to ease the burden of such a hefty load? Here are a few dos and don’ts to get you going.

• DO employ individuals who are willing to accept a great deal of responsibility. You cannot be present at all times, and it is vital that you have a staff you can trust to follow proper stocking procedures and maintain operations honestly when you are not around.
• DON’T depend completely on another individual. You are the manager, and inventory control management is solely your responsibility. While it is perfectly acceptable to delegate some of that responsibility to others in your employ, you should not place all the burden on the shoulders of another or even several others.
• DO perform regular reconciliation checks of your inventory in between formal inventory checks to verify that no items are unaccounted for. This will also help to check for any errors in the placement of items within your warehouse space, as well as in the documenting of incoming and outgoing items.
• DO regularly rotate the stock and teach your employees to do the same. Leaving older items tucked beneath new stock of the same product is poor inventory control management that results in the eventual loss of the older items due to expiration.
• DON’T overextend the budget. Part of good inventory control management is ordering smartly. Never purchase too much of a single item, even one that sells quickly. Especially if the stock is of high cost to you, make sure you only keep on hand what is necessary for any period of time. This also holds true with perishable goods.
• DO track the sales of items and determine what brings in the most profit for your department. These are the items that you’ll want to make sure you never to deplete in your inventory, always having enough on hand to meet the demand for the product. On the other hand, slow sellers should be maintained at bare minimum levels.
• DO make sure everything is properly organized and labeled for easy location within the warehouse. The larger your warehouse, the more important this level of organization is to the success and smooth functioning of your department.
• DON’T let employees get lazy; keep them motivated, and refresh their knowledge with brief training classes that provide an overview of the inventory policies in your department.
• DO be regimental and habitual about following guidelines, and set a fine example for others in your adherence to these regulations. They are provided to make your job and the job of your employees easier to do.

Keeping An Inventory Management Database For Easy Reference

If you are in charge of a small warehouse or storage space, you may not realize how important implementing an inventory management database can be. Keeping an inventory management database can help you be certain of models and quantities you have on hand. Supplies of books, CD’s, office supplies, and any other items can be tracked through a simple database without employing any complex or expensive software equipment and will assist you in knowing how much you’re keeping on your shelves.

Use of an inventory management database can range from simply monitoring the number of items on hand to determining cost of the items that you are keeping and profitability from sales.

Advantages

Databases also allow you to index materials based on various details for search options. For example, an inventory management database can be implemented in a bookstore to allow the owner to index the books carried by author, title, subject, and any other fields that are built into the database. For those looking for a way to keep track of sales, an inventory management database can be configured to keep track of the cost and sell price of an item so that, when it is purchased, the profit is logged.

Knowing the quantity of items on hand also allows you to reorder products when the stock is low. For example, if you have a small office supply store and you are down to the last three packages of your best-selling pens, you may overlook it unless you have an inventory management database to alert you of the low stock level.

While most large companies use some sort of software to keep track of inventory, many small businesses forego such important systems. Using an inventory management database to keep track of your items can be essential to the success of your small business.

Familiarizing Yourself With The Essentials Of Inventory Management

As a department manager of any type of supply market, whether books, food, or any other kind of stocked items, it is necessary to understand the essentials of inventory management so that you can maintain a healthy supply of stock while not overtaxing your budget or storage space. When managing your inventory levels, you must have enough quantity, as well as variety, in order to please the customer (whether your customer is in-house or a general consumer). However, you must also take into account several factors that concern your position as the department manager.

Concern for Space

For example, your storage or warehousing space will greatly effect decisions you make regarding the amount of products and supplies you keep on hand at any given time. If you have extra space in your warehouse, you should analyze what products are the “best sellers”, or the fastest moving items, so that you can wisely fill that space with these items. At the same time, you don’t want to overstock on expensive or slow-moving items.

Movement of Product

Always look at how well your inventory moves prior to ordering. This is essential in inventory management in order to keep items from getting old while stored. This is especially important if you work with any kind of perishables. In fact, in these instances, you should never store large amounts; simply make sure that your supply chain can replenish your stock with frequency, and check your stock daily for anything that is no longer usable.

Cost Efficiency

Finally, be aware of the costs of shipping and receiving, as well as the total net worth of the items you have in your inventory. It is essential to document all incoming and outgoing stock so that, in an inventory check, all information is accurate. Whether you are in charge of a very small division or an entire company, you’ll do well to understand the essentials of inventory management in order to profit rather than overextend the budget you’re given.

Employing Effective Inventory Management In Your Workplace

To employ effective inventory management in your workplace, you must start at the bottom and work your way up the ladder of techniques. The first thing to consider is how other employees who are involved in the stock and supply within the warehouse are currently handling the inventory for which you are now responsible.

Lack of knowledge on the part of employees is one major distraction when you are attempting to create effective inventory management systems within your department or supply house. There could be several problems to address in this circumstance. First of all, the prior manager may not have employed any kind of effective inventory management strategy, or perhaps if the individual did, there was simply no system passed on to the employees that was to be followed. Either way, you are in a position in which you must determine the next course of action. Most of the time, this will involve training the employees in effective inventory management techniques, including proper labeling and stocking of product, tracking system usage, and ordering strategies.

Identifying the Problem

Another problem may be that there is no current effective inventory management system in place. This leaves the responsibility to you to create such a system. You should start by identifying the existing problems with inventory management and addressing these. Is the stocking system organized, or is everything haphazardly thrown into the first open spot? Is stock being rotated, or is there old product sitting around wasting that is going to become a monetary issue when it has to be thrown out? Is everything labeled in a concise, legible manner so that all items can be located easily? All of these are aspects of effective inventory management that may not have been previously considered and should be worked into your new strategy.

Reorganizing

You may also need to go through the records of stock that has come and gone in recent months to determine if there are items in demand that are not being supported as necessary, as well as if there are things in the inventory that do not move well and could be eliminated or at least slowed in restocking efforts. Determining what products pull in the greatest revenue and have the greatest turnaround is a great way to employ effective inventory management strategies, allowing you to make room for “best sellers” while slowly removing items that don’t sell well.

When you have your cash cows determined, complete a system of stocking and product rotation that keeps items new and fresh, and train your employees to follow the system you’ve created, you’ll find effective inventory management simply becomes part of the daily grind and is no longer something you have to mull over every day. Your inventory checks will be concise and clear, with everything coming together appropriately, and your entire business will run more smoothly without snags. Using methods and techniques that have proven themselves in other businesses where inventory management is essential will make effective inventory management in your situation less of a problem.

Why You Should Attend An Inventory Management Seminar

The decision to attend an inventory management seminar is simple, especially if you are newly assigned to a position that requires the knowledge of how to manage inventory. There is quite a bit of information that can be gained in one of these seminars that will assist you in heading up your own department and crew in detailed inventory management. Some of the things that you will learn in an inventory management seminar are:

• Balance. While you always want to have plenty of inventory on hand to assure your customers that you will always have what they need in stock, you don’t want to overstock anything either. You’ll learn to find the right balance between supply and demand so that you don’t have inventory sitting in the warehouse not moving for long periods of time.
• Rotation. You’ll learn how to rotate stock to make sure that the inventory you’ve had the longest is sold first. Never leave the older product in the back and move new product first. This leads to a need to write off a lot of materials and wastes money.
• Budget. Regardless of the demand for a product, you should never overtax your budget to keep a hefty stock of it. You’ll learn to calculate exactly how quickly it moves out of your inventory so you know the specific amount you must keep to maintain enough stock without spending too much.
• Space. You’ll learn how to properly utilize the space you have available for warehousing to set up the most efficient inventory stocking program for your department. You’ll also learn about properly tracking the inventory and marking it for easy reconciliation with inventory checks.

Overall, an inventory management seminar will cover the basic information that will lead to your ultimate success in managing your own levels of stock and keeping track of your inventory with ease.